Gary Dayton

Overcome psychological obstacles to increase trading success

Successful traders need to be well-versed and skilled in a wide range of business and economic areas. But now, in addition to effective trading strategies and sound money management techniques, traders need to possess the know-how to handle the mental and emotional challenges of working in a highly volatile environment. Trade Mindfully is a unique resource that applies cutting-edge psychological techniques to trading skills, allowing readers to improve their mental outlooks and maximize the potential of their trading strategies. This book draws upon recent psychological research in behaviorism to teach new approaches that call for better focus, more confidence, and more positive perspectives and outcomes.

One of the key concepts covered in the book is mindfulness, a state of mind traditionally touted in the East for its ability to reduce stress and increase perspective, useful qualities for traders looking to rise above emotional obstacles and the poor results they cause. The author also discusses the importance of High Value Trading Actions (HVAs), specific actions that are under a trader's control. With this guide, trading professionals will be able to form solid strategies based on a combination of these notions and practices, leading to higher levels of trading performance.

Applies sound psychological practice and evidence-based research to the trading profession

Covers the psychological perspectives and mental skills needed to succeed in today's trading world

Focuses on key concepts that lead to deliberate practice, specific trading activities, and increased awareness and focus

Designed to help traders deal with the emotional challenges that come with uncertainty and risk

Trade Mindfully touches on the most essential concepts for anyone intrigued by what trading psychology has to offer, and delivers the best strategies for achieving the right mental skills for peak performance.

in your body such as in your shoulders or legs. Note any nervous ticks or twitching, sour stomach, racing heartbeat, sweatiness, dry mouth, and any other bodily sensation you may feel. Try to be as clear as you can with these, without going into excessive detail. Finally, note the value you identified from Exercise 8.2 that seems most relevant to your challenging situation in Exercise 8.3. In Exercise 8.4 we will develop a specific plan to overcome a challenging trading situation you have

our attention is called upon to read the market, identify trades, and manage our trades. Before-During-After helps us locate our attention and channel our consequent activities in a high-value way. It frames a process we can adopt to enhance and maximize our trading performance. When we make this separation into before, during, and after, what we want to think about in the Before time frame is the idea of High-Quality Preparation (HQP). There are certain things we can do in terms of our

in Exercise 3.2. TABLE 3.2 What Other Traders Say Are Advantages and Disadvantages of Psycho­logical Control Disadvantages Advantages Missed substantial profit Always cutting profits short Temporary relief from stress Missed choice trade setups Don't trust my system; losing confidence in my self Did not have to confront my fear Cancelled orders and missed good trades Self-image is poor Feel like a failure No self-esteem Stopped the stress—until the next trade Thousands lost in profits Failing

removes the threat and relieves the distress. The hippocampus—as the brain's memory center—stores this for future situations. The trader thus trains himself to escape trading discomfort by cutting winning trades short. Because cutting the trade is effective at removing distress and our brain codes it into memory, he is virtually guaranteed to do it again the next time. When repeated a few times, he will have conditioned himself very powerfully to cut trades in the face of stress. Avoidance of

arms, furrowed-brow glances, rolled eyes, and similar disheartening body language) as the speeches were given. After concluding their speech, participants next performed a math test by counting backward by 7 from 996 (i.e., 989, 982, 975, . . .). While they were doing this, the evaluators provided more negative feedback. For just about anyone, this would be a stressful experience. Before the speeches and math tests began, some of the participants were instructed on stress and how to view it.